Central Regional mulls FEMA loan to avoid tax hike

Mar. 6, 2014

Central Regional High School in Bayville / HOME NEWS TRIBUNE FILE PHOTO

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LOST VALUE

Here’s how much each town in the Central Regional School District lost in property value due to superstorm Sandy: • Berkeley’s tax value dropped 3.1 percent after Sandy, from $5.28 billion to $5.11 billion. The drop amounted to a $163.8 million decrease in the township’s value. • Island Heights’ value dropped 2.6 percent, from $354.5 million to $345.2 million. • Ocean Gate lost 6.1 percent of its value, slipping from $250.4 million to $235.2 million, a loss of more than $15 million. • Of the five towns, Seaside Heights lost the highest percentage of its value, which dropped by 8.8 percent. Seaside Heights lost $63.2 million from its tax base, bringing its total value down to $656.1 million. • Seaside Park lost 3.7 percent of its value, which dropped by $45.2 million down to $1.19 billion.

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BERKELEY — A school district serving five superstorm Sandy-battered towns could borrow $1 million to offset a sharp school tax increase.

The Central Regional School District is considering taking money from the Federal Emergency Management Agency because the towns it serves — Berkeley, Seaside Heights, Seaside Park, Island Heights and Ocean Gate — collectively lost $296 million from their tax bases from the historic disaster.

Before the storm, the towns were valued at $7.83 billion in total. That value dropped nearly 4 percent to $7.54 billion a year after Sandy washed away homes, flooded neighborhoods, and crippled local business districts.

“We took a lot of damage as a district,” Superintendent Triantafillos Parlapanides said.

None of the towns that send students to the district were spared, he said. For example, Seaside Heights lost 8.8 percent of its prestorm tax base, and its value dropped $63.2 million. Berkeley lost $163.8 million from its tax base, or more than 3 percent of its prestorm value.

Central Regional borrowed $1.9 million last year from FEMA to prevent school taxes from spiking in the Sandy-ravaged communities, said Kevin O’Shea, the district’s business administrator. The district can borrow a maximum of $5 million and has five years to pay it back, but can apply for an extension, he said.

This year, Central Regional is considering another roughly $1 million from FEMA as it finalizes its $35 million operating budget for the 2014-2015 school year.

Local governments and schools in disaster areas can apply to FEMA’s Community Disaster Loan Program, which offset losses to an area’s tax base that otherwise would affect operations. FEMA has reviewed and approved 60 such loans to towns, school districts and local governments throughout New Jersey, totaling more than $174 million.

Money borrowed from FEMA is paid back at a low interest rate of 1.5 percent, O’Shea said. That bill would begin to come due in 2017, at the same time the district will have finished paying some other debts.

In some areas of the country struck by disasters, FEMA has forgiven some or all of the debts. O’Shea said he hopes something similar will happen for Central Regional.

District officials plan to decide on whether to borrow the money during April’s budget adoption. Central Regional will hold a public hearing on its budget at 6 p.m. April 24, at Central Regional High School, 509 Forest Hills Parkway, Bayville.